Most scandalous scam? CM Modi sitting on Rs 20,000cr shady deal

Dailybhaskar.com

Nov 29, 2012, 15:41 PM IST

ahmedabad news in English

New Delhi/Ahmedabad: At a time when the country is mired with corruptions and scandals in allocating natural resources, 2G spectrum, CWG, Adarsh Society and irrigation in Maharashtra, to name a few, there is one billion-dollar scandal that has escaped the public gaze.

According to a report published in Tehelka, "Shady deal involving a precious natural resource worth billions of dollars has escaped public scrutiny. The deal involves the Narendra Modi government and a dubious company incorporated in the Caribbean island of Barbados."

"The Modi regime gave away a 10 percent participating stake in an expansive gas field it had won in a bidding process to a company named GeoGlobal Resources that existed only on paper. The company, incorporated in Barbados, had a capital of just $64," reports Tehelka. The GSPC has suffered a loss of interest running into hundreds of crores of rupees by agreeing to contribute GeoGlobal’s share of 10 percent to the venture fund.

The deal was signed in 2003 when BJP was in power both in Gujarat as well as Centre. But, the Barbados-based company didn’t pay a single cent for its stake. Even the company’s 10 percent share to the cost of exploration was borne by a state PSU, the Gujarat State Petroleum Corporation (GSPC).

The Gujarat government justified deal (loss) on the sole ground that GeoGlobal was a technical expert and had helped the government in preparing the geological model for gas exploration. But in its latest report, the CAG has pointed out that GeoGlobal’s technical assistance has been so deficient that GSPC had to hire another technical expert to revise the geological model from scratch which took Rs 2.64 crore as compared to 10 percent stake worth millions of dollar by GeoGlobal. The so-called technical expertise provided by GeoGlobal and its promoter Roy has now been described as sub-standard, misleading and deficient by the CAG. Besides, the 10 percent stake, GSPC also paid hefty consultation fees to Roy for his technical assistance.

The Modi government gave away 10 percent stake, which in its own eyes was worth millions of dollars to GeoGlobal on the ground that the company had international experience and a proven track record in the oil and gas exploration field. However, GeoGlobal told US authorities that it had no exploration experience before venturing into India and the GSPC-led joint venture was its first foray in the oil and gas exploration business.

Investigation by Tehelka revealed that the company was fully controlled by Jean Paul Roy, who is a geologist by profession and had worked with various oil companies as a geological expert before forming this company.

The CAG report slammed GSPC for deliberately underestimating the cost of exploration to qualify for the bid to $59.23 million while the actual cost would have been $169.270 million almost three times of the cost projected.